BSBMGT617 Develop and Implement a Business Plan - Assignment 3

Assessment task 3 - Respond to performance data

Performance objective

To demonstrate the skills and knowledge required to analyse performance reports, review performance indicators and take appropriate action to address systems failures and variances to the business plan. The Assessment Task is due on the date specified by your assessor.

Assessment description

In this Assessment Task, you will analyse performance data and reports against planned objectives, implement strategies to refine performance indicators, and address coaching and training needs.  You are also required to develop and recommend processes for the review of systems, procedures and work methods.

Procedure

1. Review the case study ‘B&A Toy Warehouse’ included in this assessment.
2. Critically analyse the information and write a brief report, responding to each question (Question 1 -4) in the case study.

Submissions

You must submit:

• A typed report covering all the questions (questions 1- 4) given in case study

Your assessor will be looking for:

• Analyse performance reports against planned objectives
• Review performance indicators and refine if necessary
• Ensure groups and individuals contributing to under-performance are coached, and provide training where appropriate

·         Review system processes and work methods regularly as part of continuous improvement

Case study – B&A Toy Warehouse

You have been provided with the following information pertaining to the operation of B&A Toy Warehouse. Review and analyse the information provided, and answer each question in this case study.

Evaluating performance measures

After identifying the performance measures, Tony evaluated performance by comparing current performance against the desired level of performance. This allowed him to determine areas for improvement to assist the warehouse in achieving its productivity goal.

Area	Current performance	Performance target to achieve 10% productivity improvement
Time Average order processing time	80 minutes	72 minutes
Cost Average cost to process an order	$200.00	$180.00
Quality Error rate	10%	Less than 1%
Production Average number of orders processed per day	50	55

Question 1

After completing a comparison of current performance against desired performance levels, identify the corrective actions required to achieve the business plan goal of improving warehouse productivity by 10%. What type of corrective actions do you recommend for each performance improvement (e.g. interim, adaptive, corrective, preventative or contingency)?

Area	Required corrective action
Time Average order processing time
Cost Average cost to process an order
Quality Error rate
Production Average number of orders processed per day

Analyse systems and processes

After implementing his strategy to monitor and evaluate performance, Tony has identified the areas that require corrective action. Tony knows that in order to do this, he must first complete a more detailed analysis of the warehouse systems and processes, and identify the specific steps required to improve productivity.

Systems

Two years ago, the warehouse implemented a custom-built electronic warehouse management system (WMS) which has had an enormous impact on productivity. When completing his review, Tony asks the following questions to ensure that the system effectively supports warehouse operations:

• Has the warehouse achieved the productivity goals that were to be delivered by
  this system?
• What is the occurrence rate of the system being out of order and impacting on the packing of orders?
• How long does it take to train new staff members to use the system?
• How do the employees who use the system rate its ability in assisting them to process customer orders efficiently?

Tony also uses the system to generate a series of reports that allow him to analyse warehouse systems and processes. The reports details:

• number of orders packed per hour, per day
• time required to pack each order
• number of packers per order
• number of boxes per order.

Tony also documents the process (from order receipt to dispatch) to assist with his analysis, and to help him to understand the exact process followed in packing an order

Tony also completes the following SWOT analysis to assist with his review.

Warehouse order processing systems and process
Strengths ●      Warehouse Management System automates administrative components of the process. ●      Simple process for packing and distributing customer orders. ●      Good orientation and induction programs for new staff, to ensure they get up to speed quickly.	Weaknesses ●      Absenteeism. ●      Warehouse layout – stock difficult to access. ●      Warehouse supervisors are all junior and new to management roles; they require intensive coaching and support from Warehouse Manager.
Opportunities ●      Warehouse extension to facilitate better layout. ●      Preferred supplier arrangement to be established with temporary workforce supplier, to ensure provision of temporary labour.	Threats ●      Forklift licence requirements mean that not all staff can drive a forklift. ●      The above requirements also require staff to have time away from packing floor to attend training. ●      Industrial action from Union members due to lack of licensed forklift drivers.

Performance measures and assessment tools and techniques

At the commencement of the performance year, Tony tasked his management team to complete balanced scorecards for all warehouse team members, and record the key result areas (KRAs) and key performance indicators (KPIs) for each role. This was done to ensure that all warehouse employees understood the performance measures for their role.

The scorecards were last accessed two months ago to complete annual
performance reviews.

Tony contacted the Human Resource Manager to obtain a report detailing the KRA’s, KPI’s and performance ratings for all warehouse employees.  He wants to evaluate the performance review process and the effectiveness of these measures in assisting the warehouse to achieve its operational plan goals.

Upon reviewing the report provided by Human Resources, Tony discovered:

• Only 80% of employees have documented KRA’s and KPI’s – 20% of employees do not know what performance level is expected of them.
• KPI’s are not aligned with warehouse goals – employees are not clear on what the warehouse is trying to achieve.
• Majority of KPI’s are not written using SMART format – they are not providing employees with clear expectations on what needs to be achieved and by when.
• Performance ratings indicate that 50% of employees exceeded performance expectations for the last performance year, which is inconsistent with warehouse end-of-year results (the warehouse did not achieve its operational plan goals last performance year).

Performance reports

As Warehouse Manager, Tony is tasked with the following human resource KRA’s:

Warehouse Human Resources Scorecard
Key Result Area	Metric
Absenteeism	3%
Turnover	8%
Long service leave liability	$2.0 million
Annual leave liability	$1.5 million
Employee engagement	85%
Employee attended training sessions	45

Warehouse Human Resources Monthly Performance Report

Report name	Human Resources Monthly Report
Department	Warehouse
Period	201X Year to Date

 

Key Result Area	Target	Actual
Absenteeism	3%	3.9%
Turnover	8%	9.2%
Long service leave liability	$2.0 million	$1.8 million
Annual leave liability	$1.5 million	$1.2 million
Employee engagement	85%	83%
Employee attended training sessions	45	32

Identifying trends

To assist Tony in understanding the warehouse operations, and to identify where he can make improvements to achieve performance objectives and measures, Tony graphs the number of orders processed and absenteeism for each month over the last year.

Question 2

1. Critically analyse the performance against planned objectives.
   1. Identify areas of non-performance.
2. Report on systems failures which contributed to these results.
   1. Consider failures in communication, planning, reporting and training.
3. Review performance indicators and refine if necessary.
   1. Comment on the suitability of performance indicators and what changes might be required to achieve organisational goals.

Question 3

1. Recommend performance improvement strategies.
2. Document a training and development strategy to address the performance of underperforming individuals or teams.
   1. Identify development needs of individuals and groups.
   2. Identify training/coaching needs.

• Present in a development plan.

Question 4

1. Develop a strategy for reviewing systems processes and work methods at B&A Toy Warehouse.
2. Describe how the implementation of your strategy would lead to continuous improvement.